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Why Brands Have a Gen Z Loyalty Problem

When it comes to Gen Z, brands have a loyalty problem. According to NRF only 36% of Gen Z feel a strong connection or loyalty to a brand. Digital natives are not motivated the same way their parents or even their older siblings are — meaning offers of free shipping or rewards points are table stakes for today’s shoppers. Though still young, Gen Z’s purchasing power is growing every year and is poised to become a critical portion of any brands business. A failure to connect with Gen Z now not only means lost sales, but playing catch up later and being faced with pricing wars to win customers.

If brands want to inspire loyalty, they need to get smart and adapt to meet Gen Z’s evolving preferences and needs. It is critical to remember that Gen Z is not homogeneous — on the contrary, it is an extremely diverse group of individuals with different experiences, preferences and expectations. Gen Z shoppers don’t just want deals, they want to feel recognized by the brand as an integral part of the business. It all comes down to personalization.

Personalization the Right Way

Tactics used to engage Gen Z can’t include any traces of generalized offerings or gimmicks. The blueprint for building a strong personalized customer experience begins with getting to know what motivates each Gen Z shopper to browse, shop and share recommendations with friends, ultimately, using this information to anticipate and meet the needs of customers, before a competitor does. More importantly, the collection of data helps to establish the relationship between brand and shopper — something expected by Gen Z.

To establish a genuine connection with a customer, brands need to seek answers to all the same questions one would ask when meeting someone for the first time. This means assessing customer needs based on what will impact their purchasing decisions.

For example, while one customer from Tallahassee, Florida may respond well to tropical getaway promotions, another customer from Denver may shrug at cheap flights to the tropics and opt to look for fresh powder in the Rockies. By constantly testing and segmenting by location, brands can tap into regional trends and avoid frustrating their customers with promotions they do not want.

To build on the example above, while the customer from Denver may be unmoved by tropical getaway promotions for the winter, they may be more interested come March or April and the customer from Tallahassee may look for trips to Maine to escape the humidity of summer in southwest Florida. Paying close attention to how a customer’s behavior changes from season to season can also save a brand from making blanket assumptions and missing out on an opportunity to offer a promotion. Collecting this data overtime allows brands to craft the customer experience based on each customer’s historical preferences, creating a highly personalized experience particular to that user.

Just as a customer’s behavior may vary depending on location and seasonality, timing on a weekly or monthly basis also has an impact on consumer habits. By monitoring customer activity and preferences, brands can gain a precise understanding of when customers shop for certain items. If a customer typically purchases paper towels every third Thursday of a month, brands can ensure that paper products are front and center on their site for this consumer every three weeks. This kind of personalization and ease of use can be the difference between a customer choosing to stick with a particular brand or try a new one. Accounting for these variables will reveal that not every Gen Z shopper will react the same way to a promotion or offer.

The Right Experience for the Right Device at the Right Time

Gen Zers do not have the same apprehensions of making purchases on the go or on mobile devices that Millennials or Gen Xers may have. Therefore, it is critical for brands to optimize their mobile properties so that customers do not have to suffer through a slow or disjointed experience every time they choose to interact with a brand via a mobile site or app. This is critical to earning the trust, let alone loyalty, of Gen Z.

For example, if a brand’s mobile site does not load or has design glitches that make it difficult to navigate, Gen Zers may not wait until they have use of a desktop to make their purchase. Instead, they will look for the same or similar product on a site with better functionality. This not only means fewer conversions, but also loss of customers to competitors and a poor brand image.

Furthermore, brands need to understand how a customer’s behavior differs based on device or channel. By collecting customer data across devices and comparing them, brands can identify how a strategy will impact a customer’s habits on one device over another. For example, a customer may make all their small purchases from their mobile device, but opt to complete larger purchases from their laptops. Brands can leverage this information to target this customer with the kinds of products they typically purchase when on mobile, rather than pulling general data on past purchases that will not resonate during the mobile shopping experience. This granular information can help brands provide the right kinds of suggestions and promotions to a customer, increasing the likelihood of additional purchases.

When it comes to meeting the needs of Gen Z, there are a lot of variables, but this is not something to be paralyzed by, rather it should be embraced as an opportunity. When brought into consort with one another, all these data points help create a truly personalized customer experience that will inspire loyalty among even the most agnostic Gen Z consumer.

Partner Content

For more and more companies, a cloud-based unified data solution is the way to make this happen. Custom cycling apparel maker Hincapie Sportswear has leveraged this capability to gain greater visibility into revenue streams, turning opportunities into sales more quickly while gaining overall operating efficiency. Download this ecommerce special report from Multichannel Merchant to more.

Being prepared for the holiday rush used to mean stocking shelves and making sure your associates were ready for the long hours. But the digital revolution has changed everything, most importantly, customer expectations. Retailers with a physical store presence should be asking themselves—what am I doing to wow the customer?